Microprocessor chip sales hit record levels in the third quarter thanks in large part to an intense two-horse race between arch rivals Intel and AMD, according to a new study.

IDC, which published the findings this week in its Worldwide PC Processor 3Q07 Vendor Shares report, said PC processor shipments grew 14.3 per cent in Q3 2007, while vendor revenue was said to be up 14.8 per cent to a juicy $7.95bn.

It also said that notebook sales had climbed significantly reflecting the trend for mobile computing, with market growth of 26.6 per cent compared to the same period a year ago.

Desktop and server processor shipments also saw a healthy rise in shipments, up by 7.7 per cent and 4.6 per cent respectively.

IDC said that AMD, which recently posted its fourth consecutive loss on Wall Street, gained a further 0.4 per cent of market share giving it 23.5 per cent in total. Meanwhile, Intel took 76.3 per cent, a share drop of 0.4 per cent.

AMD’s mobile PC processor segment grew 1.9 per cent to 18.9 per cent. Its share of the PC server processor market was also plumped up by 0.7 per cent to 13.9 per cent.

Desktop PC processor market share changes were said to be negligible, however.

IDC semiconductor director Shane Rau said: "We attribute the market's performance to Intel's and AMD's aggressive pricing for their new platforms, which stimulated early demand from PC OEMs building PCs for the back-to-school buying season.

"However, we also believe that real end demand is there. OEMs are passing processor savings onto consumers, who, instead of buying cheaper systems, are purchasing more robust configurations, partially to support Windows Vista."

IDC predicted that market demand for PC processors would continue to rise in the fourth quarter. ®